There are definite trade-offs to it: manually arranged files and folders without strict grids can create a lot of cluttered "mess". (Add to that ideas of custom per-folder wallpapers and the "mess" gets even more chaotic.) It can be confusing if you aren't expecting it, and teaching it is sometimes hard (even though some of it is more "intuitive"). The mess can sometimes hide/"lose" important files.
But the interesting benefits to it involve sometimes superior muscle memory for frequently accessed folders, a better recall of "where" you left things, and somewhat better uses of some of our human visual data processing systems for visual wayfinding via distinct "landmarks".